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I had a half hour debate in my head on this topic the other day; this is a great post thank you! I work at Walmart HQ and I think people underestimate their siz

I had a half hour debate in my head on this topic the other day; this is a great post thank you! I work at Walmart HQ and I think people underestimate their size and don't always consider what position that puts them in. They are investing heavily in private brands from grocery to apparel which will drive margins up continually over the next decades. I have heard that they are investing in some pretty crazy stuff to enhance the in store experience such as VR. We are actively cutting billions of dollars of inventory (I work in the supply chain) They are really taking a look at internal operations and reworking the organization the perform at a higher level. I don't know much about Amazon operations but I have a friend who is a vendor and he said they are a bad business partner while Walmart is a great business partner. Anything Amazon does with pricing Walmart is doing the same thing and we can push lower and that will not change for a decade. I don't think one or the other will "win" although most other retailers will die out. Amazon will get a big piece of the pie in the future but Walmart will never die, people love low prices (Walmart is synonymous with this) and customer service is going to be top notch at Walmart in 5 years as we invest in training, stores and wages.

erikpukinskis 9y ago
I am sure Walmart has lots of advantages but many of the things you are saying are speculative. Maybe VR can enhance shopping experience. Sounds like basic research though, so not a competitive advantage yet. Looking at internal organization is great, but again not a competitive advantage. Every org should be reviewing internal structures and efficiencies. Your friend likes Walmart better than Amazon. I'm sure for valid reasons. But it's a third hand anecdote at this point without any details. "Anything Amazon does Walmart does the same thing" seems disingenous. Their cost structures are different. The customers are dofferent. There be different strategies in pricing. Some will be copied, but Walmart can't copy Amazon's pricing models wholesale. "Customer service is going to be...in 5 years"... Maybe. Maybe not. Why hasn't it happened yet? What has changed? Will this new directive overtake whatever cultural forces led customer service to be what it is now? I'd be interested to see some analysis that goes deeper.
_rpd 9y ago
> as we invest in training, stores and wages ... as we raise our costs to service the dwindling market of "people without a computer and stable home address." It is astonishing that Walmart HQ still thinks that the internet is a fad. No person with a viable alternative desires to visit a physical Walmart store. It takes time, requires overcoming a variety of frustrations like traffic, parking, bewildering store layouts, and then you never know if the item you want will actually be present at the location. Compare clicking a button and having the item delivered to your door. > Walmart will never die The truth is that Walmart is already dead. They are too far behind to ever catch up, and it is clear that "HQ" thinks that bolting an "e-commerce solution" on to their existing systems will keep them competitive, when in fact the entire organization has to be rebuilt from the ground up to even have a chance. That isn't going to happen. Walmart will soon be joining Sears and Blockbuster.
- kmf5547 9y ago
  No one thinks the internet is a fad at HQ and you have no basis for that. We just bought a 3 billion dollar online retailer and put their CEO in charge of Walmart.com and online strategy is a part of every weekly buyer meeting in the company. No time in the near future will people not shop in person, the online market is under 10% and people like to shop in person. Product prices will not rise with internal labor costs; our product flow is currently not optimized which adds a lot of labor that you do not see. As that changes those labor will shoft to the store floor and create a better customer experience. Combine that with procate brands (higher margin) and your overall margin will continue to drop. If you think someone is far behind in any online business you are underestimating how quickly those things can turn around in a massive company with tens of thousands of people working on the problem.
  - a1exyz 9y ago
    These innovations are not widely publicized. Perhaps it would be beneficial to all if people could learn about new innovation at Walmart as easily as they can about Amazons. I wonder why the two are different in that department?

erikpukinskis 9y ago

I am sure Walmart has lots of advantages but many of the things you are saying are speculative. Maybe VR can enhance shopping experience. Sounds like basic research though, so not a competitive advantage yet. Looking at internal organization is great, but again not a competitive advantage. Every org should be reviewing internal structures and efficiencies. Your friend likes Walmart better than Amazon. I'm sure for valid reasons. But it's a third hand anecdote at this point without any details. "Anything Amazon does Walmart does the same thing" seems disingenous. Their cost structures are different. The customers are dofferent. There be different strategies in pricing. Some will be copied, but Walmart can't copy Amazon's pricing models wholesale. "Customer service is going to be...in 5 years"... Maybe. Maybe not. Why hasn't it happened yet? What has changed? Will this new directive overtake whatever cultural forces led customer service to be what it is now? I'd be interested to see some analysis that goes deeper.

_rpd 9y ago

> as we invest in training, stores and wages ... as we raise our costs to service the dwindling market of "people without a computer and stable home address." It is astonishing that Walmart HQ still thinks that the internet is a fad. No person with a viable alternative desires to visit a physical Walmart store. It takes time, requires overcoming a variety of frustrations like traffic, parking, bewildering store layouts, and then you never know if the item you want will actually be present at the location. Compare clicking a button and having the item delivered to your door. > Walmart will never die The truth is that Walmart is already dead. They are too far behind to ever catch up, and it is clear that "HQ" thinks that bolting an "e-commerce solution" on to their existing systems will keep them competitive, when in fact the entire organization has to be rebuilt from the ground up to even have a chance. That isn't going to happen. Walmart will soon be joining Sears and Blockbuster.

kmf5547 9y ago
No one thinks the internet is a fad at HQ and you have no basis for that. We just bought a 3 billion dollar online retailer and put their CEO in charge of Walmart.com and online strategy is a part of every weekly buyer meeting in the company. No time in the near future will people not shop in person, the online market is under 10% and people like to shop in person. Product prices will not rise with internal labor costs; our product flow is currently not optimized which adds a lot of labor that you do not see. As that changes those labor will shoft to the store floor and create a better customer experience. Combine that with procate brands (higher margin) and your overall margin will continue to drop. If you think someone is far behind in any online business you are underestimating how quickly those things can turn around in a massive company with tens of thousands of people working on the problem.
- a1exyz 9y ago
  These innovations are not widely publicized. Perhaps it would be beneficial to all if people could learn about new innovation at Walmart as easily as they can about Amazons. I wonder why the two are different in that department?